Pros and Cons of Credit

Speaking for my family, we are against credit cards. This unfortunately was not always the case.

pros & cons of creditAt the moment we are knee deep in credit card debt and trying to dig our way out. I personally always loved using my credit cards. That was before I realized what they were really doing to me. At first, it seemed they gave me so much freedom. I was able to buy almost anything I wanted whenever I wanted. Very cool. At first, the purchases made me so happy, filling a void almost. Of course once the statement came in the mail and I could only afford the minimum payment the void appeared again. I soon learned it was an endless cycle. There were times that I thought credit cards were saving us. When I had no other funds, a credit card always came through for me. What I couldn’t see was that, credit cards, were the reason I had no other funds. One time, we even got to go eat at Red Lobster for free because we had rewards through our credit card. They do offer great reward incentives. We have been paying on that particular card for almost 10 years now. I am not sure the free meal was worth it! I had, and may still have, an obsession with one particular credit card. It is and always has been my favorite. It’s black and sparkly and it refers to me sweetly. I used ( I stress used as I am currently off credit! ) this card for both in-store and on-line purchases. When I would walk into the store, I felt like a million dollars. I knew that I could pretty much have anything there that I wanted. I have paid off that card countless times, but I can’t seem to cut the card up. I am physically attached to this card and how it allows me to feel. It makes me happy. Until of course, I get the bill and realize I must have had some sort of out-of-body experience while using the card! Credit cards also make you feel important. If you have good enough credit to get a credit card, you must be doing well. At least that’s what I always thought. Of course now I realize it just means you are trying to live beyond your means and probably aren’t in good financial shape at all. I can say that because I have been that person. I have spent a lot of time living beyond my means with my plastic card. One of the best things about a credit card is that you no longer have to wait for anything, unless of course it’s being shipped to your home! While that seems like a good thing, it just enable us to be patient. Patience after all is a virtue, but the society we live in no longer recognizes that.

As a young person, I thought credit meant freedom, responsibility and reward. I thought it would save me from my troubles. As the years have passed I realize that credit really means captivity. Credit cards allowed me to be completely irresponsible with my own money. I have received no reward only a mountain of debt. I thought that credit cards would help me fill a void, when in essence I needed to appreciate the things I already had. I fell in love with the fact I could have things quickly, when in essence I lost appreciation for anything worth while. Beware, with every pro there is to a credit card, a con is right behind it!

Payday Loans

Taking out payday loans is perhaps the most expensive form of borrowing that you could ever do. For most people, using a mainstream lender or going into an authorized overdraft is a better way of handling financial issues. However, this is not always possible. If you are faced with an expensive bill, or there is a family emergency and you really need some money, then payday loans could be an invaluable lifeline for you.

The interest rate on these loans is very high, and they are marketed aggressively to encourage people to keep taking out more and more credit.

Payday Loans

If you are in a situation where your car has broken down, or you have medical bills to pay, then it makes sense to take out a payday loan. You need your car to get to work – so you will be worse off not borrowing than you would be if you took out the loan.

However, for discretionary expenses, borrowing is unwise. It could leave you spiraling deeper and deeper into debt.

Do not take chances like that. If you have taken out a payday loan, and are struggling to make the repayments. Don’t panic. Contact the lender and try to come to an arrangement with them. Be proactive, and explain how you ended up in financial trouble, and what you want to do about it. Pour every penny you have into clearing the loan as quickly as possible – accept a little short term pain if you need to – cut down on discretionary spending, and pay off everything that you can.

It is worth doing this, because it will help you to save a lot of money in the long run. Clear your payday loans, and start building a healthy credit rating in the long term.